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Bitcoin (BTC) could continue to rise in 2024. Here’s why

What a difference a year can make. Last year, Bitcoin (BTC USD) lost almost two-thirds of its value and skeptics were ready to consider it dead. This year, Bitcoin is on the rise again with a massive 128% increase in 2023. While 2023 was a significant year for the largest market cap cryptocurrency, it could rise even further next year based on two potential catalysts, both of which could occur in early 2024: the upcoming halving and the potential for a spot Bitcoin to be approved. ETF. I am bullish on BTC.

Get ready for the halving

Bitcoin’s next halving is expected to take place in April 2024. What does the halving entail?

Halvings are scheduled events that occur every four years in which the reward for mining a new Bitcoin block is halved. Currently, Bitcoin miners receive a reward of 6.25 new Bitcoins for every block they mine. After the halving, this reward will be reduced to 3,125 BTC.

There will only be 21 million Bitcoins in existence, and this fixed supply is one of Bitcoin’s main selling points. Unlike fiat currencies, which governments and central banks can print more and more of, Bitcoin is a finite resource. The halving helps curb Bitcoin’s inflation rate and causes Bitcoin to become increasingly scarce over time, which should theoretically increase its value over time.

To be clear, nothing is guaranteed, but past halvings have typically resulted in significant bull markets for Bitcoin. During the first Bitcoin halving in 2012, the block reward fell from 50 BTC to 25 BTC, and the price of Bitcoin rose from about $12 before the halving to over $960 a year later.

During the second Bitcoin halving in 2016, the reward fell from 25 BTC to 12.5 BTC and the price of Bitcoin almost quadrupled a year later, from $663 to around $2,500.

Finally, during the last halving in 2020, the block reward fell from 12.5 BTC to 6.25 BTC, and the price of Bitcoin went parabolic, rising from about $8,500 before the halving to an all-time high of about $69,000 in November of 2021.

The price of Bitcoin has declined significantly from this all-time high and past results are no guarantee of future results. However, this highlights the effect that past halvings have had on the price of Bitcoin. Based on these results, it is easy to see why crypto market participants are excited about the next halving.

Impact of a possible spot Bitcoin ETF approval

It’s not just the halving that could serve as a catalyst for Bitcoin in 2024. Some market observers believe that SEC approval of a spot Bitcoin ETF is becoming increasingly likely and will occur in early 2024.

Black Rock (NYSE:BLK) sparked excitement this summer with the filing of its spot Bitcoin ETF, and was soon followed by a mix of traditional financial giants like Fidelity and Invesco (NYSE:IVZ), technology-focused ARK Invest and Grayscale Bitcoin Trust (OTC:GBTC), who wants to convert his trust into an ETF. Bloomberg ETF analysts Eric Balchunas and James Seyffart have predicted a 90% chance of a spot Bitcoin ETF being approved for trading by January 2024.

Balchunas has noted that ARK Invest, BlackRock and others are updating their S1 applications, which could be a good sign as it means these issuers are preparing their applications for approval. Balchunas and other observers have also noted that BlackRock and others have met with the SEC to negotiate details, and that dialogue is another good sign.

It should be noted that this is all speculation at this point, but developments appear encouraging.

To be clear: speculation and excitement about the possibility of such an ETF has already driven up the price of Bitcoin in 2024. The current Bitcoin rally really took off this summer after news of BlackRock’s filing broke.

While this could potentially make approval a “buy the rumor, sell the news” event in the short term, in the long term a spot Bitcoin ETF would usher in a new era for Bitcoin.

Millions of U.S. investors could invest directly in Bitcoin through their brokerage or retirement accounts for the first time, making the process of acquiring Bitcoin exposure as easy as buying a stock or ETF.

This would open up access to Bitcoin to investors who are interested in it or are confident in its long-term potential, but do not want to manage their own Bitcoin wallet or open a dedicated crypto brokerage account with Coinbase (NASDAQ:COIN) or another provider. These ETFs could also attract more institutional investors to Bitcoin.

Additionally, ETFs from well-known and trusted blue-chip names in traditional finance, such as BlackRock, Fidelity and others who have filed, would make many investors feel more comfortable with Bitcoin and undermine its credibility among mainstream investors Strengthen cryptocurrencies.

Outlook for 2024

Bitcoin had an epic run in 2023, but in 2024 it could add to those gains due to two potential main catalysts: the Bitcoin halving, which has historically led to bullish Bitcoin price movements, and the possibility of a spot Bitcoin launch ETF that would potentially expose Bitcoin to a whole new set of investors and bring it even further into the mainstream.

Bitcoin and other cryptocurrencies can be risky and volatile investments and are therefore not for the faint of heart. I own Bitcoin and am optimistic. For long-term, risk-tolerant investors, I like the idea of ​​adding some diversification to portfolios by adding some Bitcoin ahead of these events.


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